Tuesday, 3 February 2015

TweetLondon’s mayor
has inflamed some with his claim that the directors of Boots have a duty to
their shareholders to pay as little tax as possible.But actually, he’s absolutely correct in what
he says.Company directors do indeed
have a duty, placed on them by company law, to act at all times in the best
interests of their shareholders, and maximising profits whilst minimising taxes
is entirely consistent with that.

It is, though, the
wrong question to be asking.The right
question is whether things should be that way, and why the law of the land puts
the interests of shareholders above those of the rest of us.There’s nothing immutable about company law,
and no fundamental reason why it cannot be changed to rebalance the
responsibilities of directors.

Boris isn’t the
right person to be raising such a question of course.I wouldn’t expect him to, and he’s unlikely
to surprise me by doing so.But there
are others who could and should be asking the question, and thinking about how
the law can be changed.In that context,
the spectacle of Miliband wringing his hands and limply telling the bosses of
Boots that they should pay more tax is more than a little weak and pathetic.And it tells us that he’s more concerned about
getting a headline or two than he is about changing anything.